Article 33: Nonrecourse Civil Litigation Act · Last amended 2010 · Last verified July 22, 2026
In one sentenceThis section defines civil litigation funding company, consumer, legal claim, and nonrecourse civil litigation funding for the entire act, establishing that a funding transaction is a purchase of a contingent share of a lawsuit’s proceeds rather than a loan to the consumer.
Full Text of § 25-3302
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For purposes of the Nonrecourse Civil Litigation Act:
(1) Civil litigation funding company means a person or entity that enters into a nonrecourse civil litigation funding transaction with a consumer;
(2) Consumer means a person residing or domiciled in Nebraska or who elects to enter into a transaction under the act, whether it be in person, over the Internet, by facsimile, or by any other electronic means, and who has a pending legal claim and is represented by an attorney at the time he or she receives the nonrecourse civil litigation funding;
(3) Legal claim means a civil claim or action; and
(4) Nonrecourse civil litigation funding means a transaction in which a civil litigation funding company purchases and a consumer assigns the contingent right to receive an amount of the potential proceeds of the consumer's legal claim to the civil litigation funding company out of the proceeds of any realized settlement, judgment, award, or verdict the consumer may receive in the legal claim.
Source
Laws 2010, LB1094, § 2.
Plain-English Summary
Section 25-3302 supplies the vocabulary the rest of the Nonrecourse Civil Litigation Act relies on. A civil litigation funding company is a person or entity that enters into a nonrecourse civil litigation funding transaction with a consumer. A consumer, in turn, is someone who lives in or is domiciled in Nebraska, or who chooses to enter into the transaction, and who has a pending legal claim and is already represented by an attorney when the funding arrives. A legal claim means a civil claim or action — the act does not reach criminal matters.
The definition that carries the most weight is “nonrecourse civil litigation funding” itself: a transaction in which the funding company purchases, and the consumer assigns, a contingent right to a portion of the proceeds of the consumer’s legal claim, payable only out of any settlement, judgment, award, or verdict the consumer receives. That structure — payment contingent on the outcome of someone else’s lawsuit rather than a fixed obligation to repay — is what separates these transactions from a conventional loan and is why the requirement that the consumer already have counsel matters: the attorney is meant to be in place before the funding company and consumer strike their deal.
Frequently Asked Questions
Who counts as a “consumer” under the Nonrecourse Civil Litigation Act?
Someone residing or domiciled in Nebraska, or who elects to enter the transaction here, who has a pending legal claim and is already represented by an attorney when the funding is received.
Does a civil litigation funding company have to be based in Nebraska?
The definition focuses on whether the company enters into a nonrecourse funding transaction with a Nebraska consumer, not on where the company itself is organized or headquartered.
Is nonrecourse civil litigation funding legally treated as a loan?
No. The act defines it as a purchase and assignment of a contingent right to a share of the proceeds of a legal claim, repayable only if and to the extent the claim produces proceeds.
What is a “legal claim” for purposes of the act?
A civil claim or action. The act’s protections and registration requirements apply to funding tied to that kind of claim.
Why does the definition require the consumer to already have an attorney?
The definition of “consumer” only reaches someone who is represented by an attorney at the time the funding is received, which keeps the transaction tied to a claim that is already being pursued through counsel.
Source & verification. Section text and the amendment-history citation are
reproduced verbatim from the Nebraska Legislature, Revisor of Statutes, enacted by the
Nebraska Legislature. Last verified July 22, 2026. ·
Official source
Also known as:nonrecourse civil litigation funding definitioncivil litigation funding company defined Nebraskaconsumer definition lawsuit funding actlegal claim definition litigation funding